Sending a strong signal as to the rule’s potential fate, the Acting Chairman’s call for comments refers to the rule as “misguided.” The statement notably includes a long paragraph pointedly calling into question whether implementation of the rule has addressed the humanitarian objectives originally set forth by Congress in enacting Section 1502:

The disclosure requirements have caused a de facto boycott of minerals from portions of Africa, with effects far beyond the Congo-adjacent region. Legitimate mining operators are facing such onerous costs to comply with the rule that they are being put out of business. It is also unclear that the rule has in fact resulted in any reduction in the power and control of armed gangs or eased the human suffering of many innocent men, women, and children in the Congo and surrounding areas. Moreover, the withdrawal from the region may undermine U.S. national security interests by creating a vacuum filled by those with less benign interests.

The Acting Chairman then states “[g]iven these facts on the ground, I believe that it is essential to hear from interested persons on all aspects of the rule and guidance.” Comments on the rule may be submitted here. No specific deadline has been provided.

Michael Piwowar was appointed Acting Chairman of the SEC on January 23. Jay Clayton has been nominated to serve as SEC Chairman by President Trump, but his confirmation hearing has not yet been scheduled.

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Gwendolyn is co-chair of the firm’s International Business practice group and head of its Trade Sanctions and Export Controls practice. She is also a member of the firm’s Corporate Social Responsibility group...More